If the IPO process is like an ice-breaking party for college freshmen, then the top investment bank is like a professional training institution. They help the company whitewash themselves, teach them how to do accounting in accordance with US GAAP, and take them to visit potential investors, and finally conduct an IPO, and make a public appearance.
How much power people have, how high the added value of their transactions will be, every market is like this. Although investment banks believe that they can ensure that listed companies are of high quality and that they will not make mistakes during the listing process, this view is a bit outdated by now. In the past, banks acted as gatekeepers. At that time, information was relatively closed, and investors needed to know which companies were good companies; however, nowadays, people’s access to information has increased, and the company’s reputation has become higher and higher. Therefore, in the past The role of "gatekeeper" is greatly reduced. Moreover, nowadays, more and more investment banks are only responsible for the logistics of the company's IPO process, so their voice in stipulating IPO terms has also declined.
The best entrepreneurs have already realized that a good narrative will bring them twice the result with half the effort. More and more entrepreneurs and companies can tell their stories directly to investors, and the stories will be passed on by word of mouth among more investors. In the process of investors understanding the company's development, planning, and values, roadshows have played less and less help. The reason why companies can go public with backdoor or direct listing and attract investors is not only their own cost structure, but more importantly, they directly convey the company's ideas to investors.